Sodastream International Limited: SodaStream Reports Third Quarter Fiscal 2015 Results

Tickers: SODA
AIRPORT CITY, Israel, Nov. 4, 2015/PRNewswire / -- SodaStream International Ltd. (NASDAQ: SODA), the leading manufacturer of home beverage carbonation systems, announced today its results for the three and nine month periods ended September 30, 2015.

For the third quarter ended September 30, 2015, on an adjusted basis*

  • Revenue was $110.0 millioncompared to $125.9 millionin the third quarter 2014; Revenue on a constant currency basis was $126.0 million
  • Adjusted operating income was $5.4 millioncompared to $8.9 millionin the third quarter 2014; Adjusted operating income on a constant currency basis was $10.5 million
  • Adjusted EBITDA was $9.7 millioncompared to $13.7 millionin the third quarter 2014; Adjusted EBITDA on a constant currency basis was $14.8 million
  • Adjusted net income was $4.7 millioncompared to $9.5 millionin the third quarter 2014
  • Adjusted diluted earnings per share were $0.22compared to $0.45in the third quarter 2014
  • CO2 refills reached an all-time quarterly record of 7.0 million
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*Adjusted revenue, Adjusted operating income, Adjusted net income and Adjusted diluted earnings per share are non-IFRS financial measures that eliminate the effect of restructuring costs, which include $2.5 millionof pre-tax charges incurred as part of the Company's restructuring and growth plan announced on October 29, 2014. The charges were related to activities associated with discontinued products, which decreased inventory and fixed assets by $1.9 millionand increased cost of revenue by $1.9 million. An additional expense of $0.6 millionwas associated with the transition to the new Lehavim plant in Southern Israelwhich increased cost of revenue. Adjusted EBITDA represents earnings before financial income, income tax, depreciation and amortization, and further eliminates the effect of restructuring costs. Reconciliations of the non-IFRS measures included in this press release to the IFRS results are included at the end of this press release.

'Our operating results were similar to the year ago period on a constant currency basis as the growth plan we announced a year ago continues to gain traction. Our recent performance included a number of highlights that underscore the strength of our brand and business model' said Daniel Birnbaum, Chief Executive Officer of SodaStream. 'Third quarter CO2 refills increased 10% to an all-time record 7 million, a great indication that our global user base is increasing consumption. We believe usage rates will continue to grow as existing and new consumers embrace our repositioning as a healthy 'water brand' provided by our enhanced better-for-you product portfolio, which we recently launched in the U.S. and other select countries. As we accelerate production in our new, state-of-the-art plant in Lehavim, and continue the launch of our new Waters line and strategic repositioning, we believe we are poised to start delivering improved financial results and greater shareholder value beginning in 2016.'

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Third Quarter 2015 Financial Reviews

(The financial review relates to the Non-IFRS Consolidated Statements of Operations. All USD values are in accordance with IFRS unless stated otherwise.)











Geographical Revenue Breakdown










Revenue


Three Months Ended










September 30,
2014



September 30,
2015



(Decrease)



(Decrease)




In Millions USD



%


Western Europe


$

74.6



$

68.5



$

(6.1)




(8)

%

The Americas



29.5




26.2




(3.3)




(11)

%

Asia-Pacific



13.3




9.0




(4.3)




(32)

%

Central & Eastern Europe, Middle East, Africa



8.5




6.3




(2.2)




(27)

%

Total


$

125.9



$

110.0



$

(15.9)




(13)

%


















Product Segment Revenue Breakdown










Revenue


Three Months Ended










September 30, 2014



September 30, 2015



(decrease)



(decrease)




In millions USD



%


Sparkling Water Maker Starter Kits


$

41.5



$

34.2



$

(7.3)




(17)

%

Consumables



81.2




73.9




(7.3)




(9)

%

Other



3.2




1.9




(1.3)




(41)

%

Total


$

125.9



$

110.0



$

(15.9)




(13)

%


















Product Segment Unit Breakdown


Three Months Ended










September 30, 2014



September 30, 2015



Increase

(decrease)



Increase

(decrease)




In thousands



%


Sparkling Water Maker Starter Kits



818




639




(179)




(22)

%

CO2 Refills



6,396




7,021




625




10

%

Flavors



7,607




6,726




(881)




(12)

%

The decrease in revenue year-over-year was mainly due to changes in foreign currency exchange rates which reduced revenue by $16.0 million. Since the same period a year ago, several foreign currencies have weakened versus the U.S. dollar, including the Euro by 17%, the Australian Dollar by 22% and the Swedish Krona by 18%.

Gross margin for the third quarter 2015 (before the impact of restructuring costs) was 48.4% compared to 51.2% for the same period in 2014. Third quarter 2015 gross margin was negatively impacted by cha